Sir Philip Green was warned that Dominic Chappell, who bought BHS from Green’s Arcadia Group last year, had a “history of bankruptcies and a lack of retail expertise”.
Anthony Gutman, a Goldman Sachs banker, told a cross-party committee of MPs during a BHS select committee meeting that Green and Arcadia were told about Chappell’s history four months before the deal to sell the business for £1 went ahead.
Gutman also revealed that Arcadia was made aware of Chappell’s associations with convicted fraudster Paul Sutton and that Chappell’s opening bid for the business was “very light on detail” and included “no business plan or indications as to cash flows.”
Paul Budge, the finance director of Arcadia, admitted that the company was aware of Chappell’s past and that they were “cautious” regarding a sale.
Budge then defended the decision to sell BHS to Chappell’s consortium Retail Acquisitions. He said: “We seriously believed there was a credible business plan and seriously believed he was surrounded by credible people.”
The chairman of Arcadia, Anthony Grabiner, also defended the decision. He said that he had been a “responsible” chairman, despite the fact that he had not been invited to key board meetings where the sale was discussed.
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